The world’s response to the death of Nelson Mandela is a richly deserved recognition of the suffering and struggle he endured in defence of his principles, and the humility and magnanimity he showed when he finally achieved his, and his people’s, freedom.

He didn’t just proclaim his belief in human dignity, and his insistence that we are all equal in our humanity – he lived it. It is this shining example, this living embodiment of the quest for freedom and justice, that has touched so many people.

Nelson Mandela at least had the satisfaction of living long enough to see his life’s work vindicated, even by many of those who opposed him. It is a safe bet that a substantial proportion of those world leaders who paid him homage at Tuesday’s memorial service would not have given him the time of day when he was incarcerated on Robben Island; some, we are told, “can’t remember” what they thought of him at that time and others condemned him as a terrorist. The prospect of the presence of such people at his memorial service was an irony that was not, it seems, lost on Mandela himself.

But history is full of examples of brave men and women who stood against the prevailing tide – in other words, against the dominant power structures of the time – in order to stay true to the ideals of freedom, social justice and human dignity but, unlike Mandela, went to (or were sent to) their graves without ever seeing the fruits of their efforts. For many, it was only in death, and often much later, that their true worth, and the rightness of what they fought for, was recognised.

Mandela was, in this as in so many other respects, an exception to the general rule. While he himself was the first to recognise that his eventual triumph did not mean that South Africa became overnight the promised land (in economic terms at least), the outpouring of love and gratitude for what he had achieved shows how much the freedom from repression and injustice has meant to the people whose interests he served so faithfully. In his case, he was left in no doubt that freedom and justice – and the chance of a better life – mattered greatly to those who had been denied them.

So we must ask why so many of our leaders were so slow to value the universal issues that Mandela stood for and why even today we still resist them when they arise in our own societies and in our own times. Why is it that it is only when history and distance lend a longer perspective that understanding spreads as to the worth of what the champions of human dignity and equality – the fighters for the vote and the rule of law, the opponents of discrimination on grounds of race or gender or sexual orientation, the defenders of equal and basic rights for all – were trying to achieve?

Is it a failure of imagination? Are we are so comfortable in our easy lives that we cannot conceive that many people – even in our own country – are denied what we take for granted? Are we so persuaded by the constant propaganda that everything is fine that we close our eyes to the real lives of so many of our fellow-citizens? Instead of making the small effort needed to remedy the deficiencies, would we rather deny the facts or blame the victims?

What to make, for example, of the now incontrovertible evidence of the growing extent of child poverty in our supposedly prosperous society? Are we really prepared to dismiss the the Unicef finding that New Zealand is no longer a good place for children to grow up in or the report commissioned by the Children’s Commissioner that showed more than a quarter of a million children live in poverty?

At a meeting in Auckland last week, an American woman told me that, when she decided during the course of her first visit to New Zealand in the 1970s that she would settle here, her bewildered family back in the US asked her why. “Because here,” she replied, “there is enough for everyone.”

It is hard to think of a better definition of a society that functions well and successfully. So how did we become a society in which, despite our increased wealth, there is no longer enough for children who are brought up in cold, damp and overcrowded houses and have to go to school on empty stomachs? Why are we surprised that the illnesses of third world poverty are now rife amongst us and that our educational standards are slipping?

Will those who find it opportune to pay homage belatedly to the achievements of Nelson Mandela now bring that apparent conversion to bear in the here and now? Will they recognise and act on the claims of so many our children to an equal chance in our rich and beautiful land?

In 1989, the American political philosopher Francis Fukuyama published a famous essay which he called “The End of History”. In celebrating what he believed to be the more or less permanent triumph of liberal democracy, he saw the “free market” and democracy as not only compatible but as mutually supportive. The market was in his view the equivalent in economic terms of political democracy, achieving the same dispersal of economic power throughout society as democracy achieved in political terms. He saw no need for democracy to act as a restraint on “free-market” outcomes, and he saw no danger that the “free market” might in some ways prove inimical to effective democracy.

He was confident that the rest of the world would flock to the democratic banner. Just over twenty years later, that expectation has been confounded. Confidence in democratic processes – both here and abroad – is at a low ebb. So, what has gone wrong?

The seeds of the problem had already been sown by the time Fukuyama published his essay. The received wisdom of the immediate post-war years – that full employment should be the prime goal of economic policy, that collective public provision was needed to guarantee basic standards of essential services, and that market excesses would have to be restrained by careful regulation – had been replaced by new ideas.

The individual, rather than society, was seen as the pivotal point of human endeavour and progress; writers like Hayek and Nozick questioned the need for or appropriateness of an extended role for government or the acceptability of meddling in “free” market solutions; redistributive taxation, the provision of taxpayer-funded benefits to the disadvantaged, and the power of organised labour came to be seen as obstacles to economic growth rather than as guarantees of an equitable distribution of wealth; economists like Milton Friedman questioned the efficacy in peacetime of Keynesian intervention and promoted the idea that macro-economic policy was really just a simple matter of controlling the money supply in order to restrain inflation; while global developments such as the oil-price shock of the early 1970s meant that inflation rather than full employment was seen as the primary issue for economic policy.

Many of these ideas had been carried into government by Ronald Reagan in the United States and Margaret Thatcher in the United Kingdom. The two leaders made common cause at the beginning of the 1980s in taking a step whose significance perhaps even they did not fully grasp at the time. The portentous decision was taken in the United States and in the United Kingdom to float their currencies and to remove exchange controls. The way was now clear not only for an explosion in international trade and foreign investment, but for a determined assault by international capital on the political power of democratically elected governments across the globe.

The ability to move capital at will across national boundaries not only meant that international investors could bypass national governments but also enabled them to threaten such governments that they would lose essential investment if they did not comply with the investors’ demands. This shifted the balance of power dramatically back in the direction of capital, and set the seal on the triumph of those “free-market” principles of economic policy that became known as the “Washington consensus”.

It became accepted that the “free market” was infallible and that its outcomes should not be challenged. Any attempt to second-guess the market would inevitably produce worse results. Everyone – it was thought – would be better off if the rich and powerful were subject to no restraint in manipulating the market to suit their own interests.

But the whole point of democracy – that the legitimacy enjoyed by elected governments allowed them to defend the interests of ordinary people against the otherwise overwhelming economic power of those who dominated the market – was thereby lost.

We see the outcomes of this shift all too clearly. Virtually the whole of the increased wealth of the last three decades has gone to the richest people in our society; poverty, even in the “rich” countries, has risen while inequality, with its attendant social ills, has widened; the rights of working people at work have been weakened; joblessness is endemic; and the “free market” free-for-all achieved its culmination in the global financial crisis.

A “Europe” imposed by an elite and constructed in the image and to suit the interests of international capital has come unstuck and flounders in recession and unemployment. The austerity demanded by Europe’s leaders makes a bad situation worse. Popular support for the European Union has nosedived. Major decisions continue to be made by big corporations and not by elected governments. Faith in government and the democratic process is at a low ebb and attempts to consult the people on Europe’s future continue to be resisted.

“History”, in other words, has continued to unfold. Very few seem to realise how thoroughly our civilisation has been transformed by the triumph of the “free-market” ideology. They do not see that western liberalism, which has informed, supported and extended human progress for perhaps 700 years, has now been supplanted by an aggressive self-interested doctrine of the individual which leaves no room for community and cooperation. Even the victims of this comprehensive and fundamental change seem hardly aware of what has happened.

Fukuyama failed to recognise, in other words, that the threat to western democracy came from within those democracies themselves. It came from the greed and self-interest of the rich and powerful and their ability to manipulate the “free” market to their own advantage, but also from the quiescence and apathy of that much greater number who fail to understand that democracy is necessarily sidelined if the market cannot be challenged. The substance of democracy has been hollowed out, so that only the shell, the forms, remain, because we have not cherished and made a reality of what was our most valuable protection and greatest achievement.

Nothing better illustrates Labour’s current malaise than the reported difficulty the leadership group is having in agreeing on a strategy for an election that is now only a few months away.

Some, we are told, including most of the “New” Labour veterans, favour a direct pitch for middle-class support, with plentiful assurances that the Party’s leaders come themselves from “comfortable” backgrounds. Others recommend a focus on Labour’s “core vote” in a belated attempt to re-assert the Party’s traditional values and priorities.

Neither group seems to doubt that this is an unavoidable dichotomy. Just as the Blair/Brown schism is seen as essentially unbridgeable, so this dispute seems to reveal a deep fault-line in the Party’s thinking. After thirteen years in government, and nearer sixteen years with the current leadership group, it is surprising that this is the best that can be done.

It is hard, after all, to see that either strategy offers much prospect of electoral success. First, the notion that “we are all middle-class now” is hardly new. It has been the leit-motiv of New Labour since its inception. If the aim is to re-enthuse the voters, the strategy seems to lack a certain sense of excitement or breath of fresh air. “Vote for us and we’ll go on doing what is perceived to have failed” is not much of a rallying cry.

It also commits the cardinal sin in political strategising of allowing one’s opponents to frame the debate. The American specialist in cognitive science and linguistics, George Lakoff, is clear that to adopt the opponent’s language is to concede the debate. In a contest as to which party is more likely to put middle-class lifestyles, privileges, and values ahead of anything else, especially off the back of recession, there will only be one winner.

There is not much better to be said for the rival strategy. Labour’s “core vote” is now a sadly wasted asset – one of the consequences of ignoring it for the past sixteen years. It is unlikely to be revived by a quick and short-lived about-face by Labour’s spin doctors. And it is in any case a defensive strategy designed only to limit losses – a strategy that, by abandoning a large part of the battlefield to the enemy, necessarily concedes defeat in advance.

If Labour cannot do better than this, they deserve to lose. The inevitable burden of cumulative disappointments after thirteen year of government, to say nothing of egregious errors like the Iraq War and a recession engendered by a sustained obeisance to the City, will not be overcome if Labour’s much-touted strategists do not come up with something more intelligent and imaginative – and more optimistic.

The perceived dichotomy in electoral strategy must be rejected as a chimera. There is no success for Labour in either restricting itself to the “core vote” or in ignoring it by manifestly adopting other priorities. Labour strategy has always required a successful effort to persuade a sizeable slice of the more affluent that they will be better off, both materially and in other ways, under a government that accepts as one of its priorities that it should look after the less advantaged.

The argument should be that both the economy and society will function better if everyone has a chance to make a positive contribution. Excellent public services will produce a better educated, better housed and healthier workforce, better able to take the jobs that full employment will make available. Running the economy in the interests of the whole workforce, and not just City fat cats, will boost output and productivity and increase the resources that can be invested in our economic future. Investing in new skills and technology, and in the development of new products and markets, will in turn lay the foundations for an inclusive prosperity in which all can share.

An economy run like this would produce a stronger and better integrated society, no longer riven by division, no longer weakened by a disadvantaged underclass that increasingly sees the only way out being achieved through crime, drugs, gambling and prostitution. Even the most purblind defender of middle-class privilege might be persuaded to recognise the benefits of living in a healthier and more inclusive society.

A message like this might sound impossibly idealistic, but would this necessarily be a bad thing? To set a course that at least aims at something better is more constructive, more likely to enthuse, than constantly triangulating for supposed electoral advantage. Labour should not, in other words, allow itself to be forced to choose between its “core vote” and middle-class support. The two are perfectly compatible, and to act with that conviction offers Labour’s best hope for the forthcoming election.

As the global economic crisis gathers force, it sweeps before it not only the flotsam of discredited economic doctrines; it also demands a complete reappraisal of how economies and societies work. It poses again the great questions that underlie all political debate, and it poses them in the certain knowledge that the answers given over the past thirty years – and so widely accepted – must now be rejected.

This is, in other words, one of those rare moments when it is not only possible but positively essential to go back to first principles. We must ask again, what is the purpose of politics, what is the role of government, does democracy matter, and – for those who see the need and seek the opportunity for reform – what does it mean to be on the left in politics.

Those questions must be asked, of course, at a time when – in Britain at least – left politics has run into the buffers. The concessions and subterfuges that were thought to be necessary to win power and then to hold it are now unmasked as not only craven but also totally destructive of anything that could have been legitimately regarded as the true purpose of left politics. If there is one incontrovertible lesson to be learned, it is that a left politics that is disconnected from principle and analysis will lead to failure and defeat.

The opportunity is, then, to think again about that body of principle and structured analysis that should underpin any left approach to politics. Our starting-point for such an inquiry must surely be a recognition that, since the late 1970s, and with the often unstated acquiescence of the left, the political agenda has been dominated by neo-liberal thinking.

The dominance of this self-serving doctrine has been a huge achievement for those who already exercised great economic power, but felt their privilege threatened by the political power of democratic electorates. They feared, correctly, that elected governments, accountable to the widest range of interests, would not tolerate a system which unfairly favoured the rich and powerful by allowing them to rig the contest for power in their favour.

The powerful responded to this threat by bringing about changes, around the end of the 1970s, which negated the power of democracy – changes whose significance was hardly recognised at the time. They made elected governments irrelevant, by acquiring a degree of economic power that would allow them to face down and blackmail all but the most powerful democratic governments, and then by using their economic power and invulnerability to political pressure to bend even the most powerful governments to their will.

The individual steps by which this was achieved need be only briefly rehearsed here. One of the earliest was one that masqueraded as a purely technical change that would help international trade and investment, and that was sold to the ordinary citizen as a welcome reduction in bureaucracy. That change was of course the removal of exchange controls by Reagan and Thatcher so that international capital was free to roam the world in search of the most favourable investment opportunities.

In one step, the rules of the game had changed hugely. Investors no longer had to comply with the requirements of elected governments. Instead, governments found themselves played off against each other by investors who commanded greater and greater resources as the now global economy was funnelled into fewer and fewer hands.

Now, it was governments that had to sue for terms, and who would lose out in the competition for investment if they did not comply with the demands of the multinationals. The investors, on the other hand, now understood that they could exercise their power quite irresponsibly; it was, after all, governments – not the investors – that had to answer to their electorates. The investors answered to no one but their shareholders. Most costs could be “externalised” or passed on to taxpayers who no longer had a voice. And, as voters began to understand that their governments could no longer protect them, confidence in the democratic process began to weaken.

At around the same time, monetarism – the doctrine that managing the economy was a more or less technical exercise in controlling inflation (the only goal, it was said, that mattered) by regulating the price of money – became the accepted wisdom, on the left as well as the right. This technical task could safely be entrusted to unaccountable officials – bankers no less – so that, in one simple step, democratic government was excluded from perhaps the central function for which it was elected.

These ground-breaking changes were reinforced by re-shaping political structures in the image of international capital. Multi-national investors found it increasingly irksome to have to deal with national governments, each with its own set of requirements, each reflecting the particular interests and priorities of their own voters. They insisted that economies would function more efficiently if those controlling investment capital could deal with authorities, like the European Union, that matched their own multinational structure and scale – and that were not democratically elected, but were instead multinational bureaucracies whose goals coincided with their own. So powerful was the momentum towards the integration of national economies in the name of greater economic efficiency that no one seemed to notice that the long-term consequence was not only an actual reduction in economic efficiency but also a political loss of a most serious kind – the replacement of democratic governments as the ultimate authority by multinational capital.

The ability of multinational capital to set the political agenda meant that a doctrine that could never have been directly sold to voters in individual countries – the view that markets are infallible, that they must not be regulated or interfered with in any way, that the interests of shareholders and the bottom line are all that matters, and that governments must step aside while market forces have their way – became the dominant driver of the world economy.

Few seem to have understood – not even politicians supposedly of the left – that an “infallible” market and democracy cannot co-exist. The whole point of democracy, after all, is that ordinary people can use the political power of democratic legitimacy to offset what would otherwise be the overwhelming economic power of the privileged minority. If even democratic politicians accept that they are not only powerless to intervene in the market, but that it would be literally improper and counter-productive for them to do so, then the powerful are unconstrained in their ability to impose their will on the rest of society.

We can now see the inevitable consequences of that extraordinary concession by democratic politicians – one that is even more incredible when made by politicians of the left. Unrestrained markets will always threaten, as even Adam Smith pointed out, a conspiracy against the general interest. They will always lead to excesses. They will always, as a consequence, destroy themselves in the end. The global recession was the direct and inevitable consequence.

We can also see how and why the New Labour government lost its way. Its fascination with the rich and powerful, its acceptance that the unregulated market must always prevail, its belief that market solutions will always be best, and its embrace of a global economy dominated by international capital all meant that it opted out of the role that most of its supporters expected it to fill – the diffusion of power in society so that the less powerful were protected and treated fairly.

Tony Blair seems to have believed that he could take the pain out of politics – and even the politics out of politics. But politics in a democracy is the means by which we resolve issues that would otherwise be settled by less acceptable means; we wouldn’t bother with the messy business of politics if it were not preferable to brute force or the victory of the most powerful. And those issues – arising as they do from the ever-present needs to allocate scarce resources and to reconcile conflicting interests – cannot be wished away. Their resolution will shape important issues such as fairness, opportunity and accountability – crucial determinants of how well society functions and how comfortable individuals feel within it.

All politics in the end is a response to a fundamental characteristic of social organisation. All societies demonstrate an inevitable tendency for power to concentrate in a few hands. The power may be physical, economic, or social – but at its most fundamental it is power to make choices, the freedom to choose, even at the expense of and against the interests of others.

In any society, those who are stronger, cleverer, or luckier, or who enjoy some other advantage, will inevitably acquire more power than others. They will then, with equal inevitability, use that power to enhance their advantage, accreting to themselves differential privileges which will make them yet more powerful, allowing them to entrench that advantage and defend it against attack, and by doing so to reinforce the disadvantage of others. The response that should be made to that intensifying concentration of power is the central and defining issue of politics.

The dictator will say that there is nothing wrong with power being concentrated in a few hands, as long as those hands are his. Patrician conservatives argue that it is inevitably a permanent feature of any social organisation, and that the stability it provides is on the whole beneficial. They will say the emphasis should be on making the disparity in power acceptable, by requiring the powerful to exercise their power humanely and with some kind of social conscience – a kind of noblesse oblige. The less powerful, on the other hand, should be conditioned by social pressures to accept – through a well-developed social hierarchy – their inferior lot in life and the deserved superiority of their betters.

The liberal (or, according to taste, the social democrat or proponent of the “third way”) will also accept that a substantial degree of inequality is inevitable and must be tolerated, but will argue that it can be made more acceptable and even positively beneficial provided that everyone has a fair chance of winning, or at least doing well, in the contest for power. Provided that everyone lines up at roughly the same starting point, no one can complain if the race goes to the fleetest of foot. The harsher edges of the neo-liberal winner-takes-all approach can be softened, it is fondly hoped, if those who bring up the rear are guaranteed some minimum standards of social support, through some redistribution of wealth and income and an acceptance of community responsibility for basic services.

The neo-liberal, on the other hand, will regard the concentration of power as not only inevitable but positively desirable. According to this view, those who gather power to themselves will be the most able and deserving. The fact that society is led by the most able will mean that everyone benefits; even the disadvantaged and least powerful will benefit as the rising tide lifts all boats. The possibility, too, that the least powerful can contest for power, and that the exceptionally able or lucky individual might make the breakthrough will ensure a degree of social mobility and contestability that will maintain the vitality of the system.

According to this view, it will be literally counter-productive to try to counteract the concentration of power by ensuring that it is more widely distributed and equally shared. The only consequence would be to drag everyone down to the level of the least able. Contrary to the delusions of the “third way”, the dice must be allowed to lie where they fall. To try to alter the outcome of the game would be to deny the beneficial potency of allowing the winners to prevail.

Historically, the left has shared much of the liberal or social democratic agenda, but has evinced less tolerance for the degree of inequality that is inevitably tolerated by that approach. Crucially, only on the left has substantial, entrenched, and often inherited inequality been seen as a straightforward negative, an affront to notions of justice or fairness, a gross limitation on the freedom of the less powerful and therefore of society as a whole, a drag on economic efficiency, a dagger driven at the heart of social cohesion. Only on the left is there an imperative to address the way that power is distributed – and not just redistributed – and the social and economic price that everyone – including the most powerful – is required to pay for a substantially unequal distribution of power. It is that imperative – to achieve something near equality, not identity – that is the defining characteristic of left politics.

If this is what left politics is really about, what should the left response produce by way of a policy agenda? The first part of the answer to that question concerns the relationship between the market and government, between economic and political power.

No government – of any persuasion – should delude itself as to the critical and irreplaceable role of the market in a modern and democratic economy. At its best, the market allocates scarce resources, empowers consumers (through what might be described as economic democracy), stimulates efficiency and innovation, and rewards the most productive and creative.

The market is, however, a valuable servant but a dangerous master. It is the elevation of the market to the status of a moral force that cannot be challenged that enables the powerful to by-pass democracy. That view must be contested. If democracy is to mean anything, government must be ready to intervene in the market so that its outcomes are acceptable and sustainable, both politically and economically. The deliberate aim of a left government must be to utilise the market so as to optimise its great strengths, but to make sure as well that the market does not prejudice – through entrenching and extending the power of the privileged – the wider goal of diffusing power as widely and as fairly as possible throughout society.

So, good government matters. It is the means by which the market is restrained so that the full resources of the whole of society are deployed to the widest advantage, by which essential services are provided, by which the economy is managed and directed for the general good, by which the benefits of citizenship are fairly and productively shared, by which the cohesion of society is effectively developed.

This is of course at odds with the right-wing doctrine that government should limit itself to a minimal responsibility for maintaining the value of assets – and particularly the currency – and should otherwise merely hold the ring while market operators are allowed to get on with it. The left, on the other hand, has always taken the view that governments are inevitably major players in the economy. They are the most important investors, customers and employers. They influence events and behaviour through policy decisions. As a result, they should accept responsibility for the overall context in which economic activity takes place. They should properly be concerned with the appropriate level of demand, the provision of gainful employment opportunities for all citizens, and the fair distribution of the fruits of economic activity. It was the abandonment of these responsibilities, particularly by the left, that has contributed so greatly to the global crisis.

A proper balance between the roles of the market and the government, between economics and democracy, is essential. It need not – as is often argued – require a sacrifice of economic efficiency for the sake of social outcomes or political principle. The lesson of the last thirty years is that “free- market” economics do not lead to efficiency – great riches for a tiny minority, yes, but sustained and equitable economic progress for all, no.

The case for diffusing power throughout society is as much economic as it is social. We make the most efficient use of our resources, and particularly of our human resources, if everyone has the chance to make their most appropriate contribution to wealth-creation, if that contribution is fairly recognised and rewarded, if everyone’s potential is properly recognised and not suppressed, if we understand that no individual is so talented as to merit rewards hugely greater than those enjoyed by others when it is the cumulative effort of the whole of that society that is overwhelmingly responsible for the progress we have made.

A similar argument can be made concerning the proper use of our natural resources and the sustainability of our environment. If decisions on these matters are taken by democratic agencies answerable to the widest possible constituencies, rather than by a handful of self-interested operators in a short-term market which they dominate, we have a better chance of managing our natural resources to the greatest possible advantage for all of us and of our planet.

These economic and environmental arguments reinforce the great social case for a wider diffusion of power. Freedom in society is not to be measured by the level enjoyed by that powerful minority that benefits from the greatest freedom of choice. Freedom exercised by denying freedom to others – even indirectly, through the supposedly value-free operation of the market – is not the mark of a free society. Only by diffusing power, by breaking down concentrations of power, can we optimise freedom for everyone. The supposed antithesis between freedom and social justice dissolves away when the goal is to allow everyone the maximum level of freedom that is commensurate with a similar level for others.

A society in which power is fairly shared, in which everyone has the opportunity to contribute and where that contribution is valued and rewarded, where the benefits of living in society are treated as social goods to which everyone is entitled, will be a society which is cohesive and integrated, which feels good about itself, and which is less likely to display the anti-social behaviour that characterises those marked by alienation and growing inequality.

These principles of democracy, social justice, and community – and the analysis by which those principles are derived – provide us with the basis for deciding an appropriate left political agenda. On issues such as who owns, controls and benefits from the economic process, what is an appropriate level of guaranteed provision of the basic requirements of a civilised life, what attention should be paid to the interests of others beyond our shores and beyond our lifetimes, how important to social cohesion and unity is a sense of fairness, we should be clear what the touchstones are.

The demands of practical politics will inevitably require compromise and trade-offs. But each policy, each new initiative, should meet a sort of health check provided by the touchstones. The alarm bells should ring if the policy agenda is seen to fly in the face of the basic principles. If only New Labour had heard them toll!

Adherence to a body of principle and analysis does not dictate, as is sometimes suggested, a static or backward-looking stance. It will suggest and require adjustments to existing policies as circumstances change. It will inform and stimulate new policy to deal with new issues. It will urge us on to meet the future.

A left agenda framed in this way will exhibit many familiar features and is none the worse for that. Policies for increasing the stake of ordinary people in wealth-creation, for ensuring through redistribution that wealth is shared more fairly, for using the public purse and community responsibility to guarantee the delivery of basic services should all feature prominently.

But we should also expect some new thinking to address new issues. A good example is the reappraisal now needed of the value of labour in the economic process. The new reality of labour’s declining importance in wealth-creation by comparison with capital-hungry technological advances means that labour by itself is no longer an adequate basis for a claim to a fair share in society’s riches. It may be that it is citizenship, not labour, that should form the basis of that claim, and that we need a new concept of citizenship to help us sustain it. Citizenship is already the basis for a large number of claims on society – equality before the law, the right to vote, and the whole range of human rights; it is not so revolutionary to propose that those basic claims should include a right to a fair share of society’s resources.

We will also need a longer timeline and wider horizon than the market can provide if we are serious in our concern for the preservation of our environment and natural resources. Government intervention on behalf of the community is inevitable if we are to inhibit climate change, maintain a fresh and clean water supply, encourage the biodiversity on which our future may depend and establish a new relationship between humankind and our planet. We need to re-think patterns of land use, methods of food production, and the production and uses of energy. The market can help, but it will be a market that is rigged to produce particular outcomes in the public interest.

In economic terms, we should reclaim economic policy (including monetary policy) as the proper responsibility of democratic government rather than of bankers and a proper subject for public debate. We should recognise that economics is a behavioural science and does not lend itself to mechanistic solutions. In particular, we should re-examine the role of the privately owned banks in the light of the current debacle and question whether they should ever again be allowed a virtual monopoly of credit creation. In view of the burden that bank failure has imposed on the taxpayer, should the banking function not be seen essentially as a public responsibility?

The roles of limited liability and the joint-stock company should be re-examined, in view of the irresponsibility and disregard for the public interest that they have demonstrated. New models of industrial ownership and control should be explored, including those that would give working people a stake in their own enterprises.

A left government should take the lead in negotiating new agreements to reform international financial and economic arrangements so that multinational capital takes a more responsible attitude to the communities in which it is invested, the volatility of foreign exchange markets and the flows of “hot money” are restrained, and global imbalances between rich and poor and between debtor and creditor nations are addressed effectively.

In social terms, a left government should recognise the over-arching importance of making whole again a society that has been fractured by class, economic circumstance, ethnicity and religion. An inclusive society based on fairness and tolerance and one that placed a value on all its citizens would not only be the most effective antidote to crime and other anti-social behaviour but would also provide the conditions for improved economic performance. Making full employment again the prime goal would be important. An attack on economic inequality through a combination of integrated tax and income support policies would produce a more cohesive society. Health and education services that reflected the public service ethic rather than the profit motive and the market mechanism would also be helpful.

Overseas, a return to Robin Cook’s ethical foreign policy would help to restore Britain’s standing as a force for good in the world – and the world might follow suit as a result. The same tolerance and inclusivity as was shown domestically would produce similarly constructive results internationally. We should have no more complicity in illegal invasions and torture, or in denials of human rights at home.

Proposals like these are, of course, no more than signposts. They do not by themselves constitute anything like a comprehensive programme. Rather, they indicate the kind of new – and not so new – thinking that a left agenda that is true to the analysis offered here might encourage. We have the chance to return to our core values and goals, and to update them in the light of events that can now be seen to underpin and validate our approach to politics. We should not miss that opportunity.

Bryan Gould

15 March 2009

This piece will be published in the next issue of Soundings in the UK. A shortened version is published on 27 March in an online book called The Crash, edited by Jon Cruddas MP and Jonathan Rutherford. It can be accessed at http://www.lwbooks.co.uk/ebooks/crash.html.